Sales and Use Tax Annotations

Annotation 330.2530

(a) IN GENERAL

330.2530Out-of-State Use of Leased Property. A lessor purchases tangible personal property (none of which is mobile transportation equipment) for resale from suppliers both inside and outside California. The first lease is at a location outside California. Following termination of this first lease, the lessor brings the property into California, not for lease to another lessee, but for use in the lessor's own operations in California.

If the property was purchased by the lessor outside California, and does not enter California within 90 days of the start of the out-of-state lease, the lessor's use of the property in the lessor's own operations in California is not subject to use tax.

If the property was purchased by the lessor inside California, and did not reenter California until after six months from the start of the out-of-state lease (section 6009.1), the lessor's use of the property in the lessor's own operations in California is not subject to use tax. 3/17/88.

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